Thursday, 13 January 2011

How is Superannuation split as part of a Property Settlement?

Q: My husband and I are getting divorced after 15 years of marriage and we're currently talking about the property and financials. Is superannuation part of that split? Is it 50-50? Can we decide on the split?

A: Broadly speaking, there is a four-step process the law uses.

1. Determine Assets and Value - The Matrimonial Pool
This includes all assets and the value at the day the division happens. It does not matter whose name the assets are in. All the assets form the 'Matrimonial Pool'. This includes Superannuation entitlements.

2. Determine the Contributions You and Your Spouse made towards the assets.
This considers non-financial assets (cars, houses) as well as financial ones. Consideration is also given to what assets you both brought into the marriage.

If your financial position was similar when you started your relationship and you both contributed financially through employment income, or if one of you was a homemaker while the other worked, then your contributions would be considered to be equal.

3: Determine your future needs.
Factors considered include: your respective capacities for earning income, and ages.

The result would be a percentage division of the matrimonial pool.

4: Make Just and Equitable orders
How could the assets be divided to achieve the result in Step 3? Does the house need to be sold, or does one spouse buy out the other? An order to split one or the other spouse's superannuation can form part of the orders.

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